Minnesota's young 'invincibles' are key to health insurance overhaul

Paul Beach may not feel the weight of it, but he's a linchpin in making the federal health care overhaul work.

He's 28, fully employed and uninsured.

"I want insurance," he said. "But it's a tossup between eating food or buying health insurance. I'd need a second job just to pay the insurance."

As Minnesota and other states get ready to launch new insurance exchanges on Oct. 1, one of the big challenges is persuading people like Beach to buy coverage. Minnesota's MNsure exchange is firing up an all-out marketing blitz, with young adults one of the key audiences.

To keep costs low for everyone, insurers will have to get as many people paying for coverage as possible. The idea is to spread the cost of caring for older and sicker patients across large numbers of people with relatively few health care needs.

"When you look at the ads and what's on billboards, they're trying hard to play to that demographic to get them engaged," said Steve Parente, a health finance professor at the University of Minnesota. "It might work."

An abundance of research indicates that young people value health insurance, despite their reputation as "invincibles" who don't worry a lot about medical coverage.

Instead, pocketbook economics remain the chief reason young people roll the dice and go without coverage.

"It's really an affordability issue," said Jen Mishory, deputy director and founding member of Young Invincibles, a Washington, D.C., policy advocacy group. "A lot of young people work part time or at jobs that don't pay benefits."

That has been true for Beach, of Minneapolis. He has worked at Dunn Bros. for 11 years, the past six as a coffee roaster. "I love my trade," he said, but the company doesn't currently offer insurance benefits.

Beach purchased insurance in the past, but dropped it because he couldn't afford the $190 a month premium. It's particularly alarming, he said, because his mother went without insurance and put off going to the doctor until getting a late-stage cancer diagnosis. She died last year.

"I haven't had a physical or been to a doctor in 10 years," Beach said. "I have no idea what's going on in my body. Everyone I know says they'd rather wrap up a broken arm with Popsicle sticks than go to the emergency room and face financial ruin."

Lower monthly insurance bills will inevitably come with higher out-of-pocket expenses and fewer choices in where to go for medical care.

But a majority of adults in their 20s will qualify for government subsidies available on the exchanges, according to the Urban Institute, which could take out some or all of the bite.

In Minnesota, individuals earning up to $15,282 qualify for Medicaid and won't have to pay a premium at all. Those with income up to $22,980 will kick in a modest portion of the premium for coverage from the state's MinnesotaCare program. Individuals making up to $45,960 will qualify for varying levels of tax credits, which are claimed at the time of enrollment.

In all, up to 84,000 currently uninsured 18- to 34-year-olds in the state could be eligible for tax credits and another 72,000 could be eligible for Medicaid, according to state data.

Kate McCulloch, a 30-year-old doctoral student at the University of Minnesota, has been paying close attention to the rollout of the exchanges. As a graduate assistant, she's currently covered under the university's health plan. But she'll graduate after the fall semester and faces the prospect of buying insurance on her own.

Using a premium calculator on MNsure's website, McCulloch discovered that her premiums might be lower if she buys coverage through the exchange, where she'll qualify for tax credits, rather than on her own.

"I'll probably try to find a way to pay for it no matter what," she said. "It's very important to me to have insurance."

Minnesota has lower rates of uninsured among 18- to 34-year-olds than the national average, according to data from the Young Invincibles organization. About 17 percent are without coverage, compared with 28 percent nationally. Uninsured rates are higher among men than women and among the state's Hispanics and Latinos (45 percent), African-Americans (29 percent) and Asians (21 percent) than whites (15 percent).

The state is focused on getting the word out about the MNsure exchange to all residents, but reaching young people could be more of a challenge, said Mary Sienko, MNsure's communications and marketing director.

"Research has shown that those young invincibles don't often respond to general advertising tactics, like radio and TV," Sienko said. "And they can be very cynical about ads, too."

"They like things short and sweet," Sienko said. " 'Give me the facts and tell me why it's important to me.' "

Ads featuring the misadventures of Minnesota's woodsy icon Paul Bunyan and his companion Babe the Blue Ox tested well in focus groups with young people, Sienko said, even though the characters "may not have been a big part of their childhood."

As part of the state's $20 million campaign, MNsure will try to reach young people by using social media and mobile apps, as well as showing up at such gathering spots as community colleges and concerts.

The federal government is pressing hard to reach the 19 million uninsured young adults as well. It has teamed with Young Invincibles on a nationwide video contest offering 100 prizes worth $30,000 (with a maximum of $6,500).

"There's a lack of health insurance literacy in the population as a whole, but certainly among young people," said the Young Invincibles' Mishory. "Many don't have the traditional on-ramp to coverage through the workplace."

Insurance executives as well as Obamacare supporters are banking that making health care affordable will dissuade consumers from opting to pay the penalty for not complying with the individual mandate. In 2014, the penalty is $95 or 1 percent of household income. It rises to $325 or 2 percent of income in 2015 and $695 or 2.5 percent in 2016.

Advocates of the state marketplaces are heartened by the experience in Massachusetts, which also required everyone to buy insurance or pay a fine when it launched reform efforts in 2007. In the first year, the rate of uninsured among 19- to 26-year-olds fell from 21 percent to 8 percent.

For 26-year-old St. Thomas student Alex Hoeppner, getting insurance is a no-brainer. The St. Paul resident is an avid snowboarder, biker and outdoor enthusiast, which has led to some mishaps. He fractured a leg in three places and has broken the same wrist twice. For now, he sets aside money he earns working part time at a pizza shop to buy short-term coverage from Medica. But he said he's looking forward to seeing what kind of options he'll have through MNsure.

"Having a primary care doctor isn't important," he said. "I don't visit the doctor regularly. For me, it's all about the emergency room visits and the broken bones. I'm not willing to go without insurance forever. It's too much of a risk."

Jackie Crosby • 612-673-7335